IMDEX presentation UBS Australasia Conference 2019 CONFIDENTIAL – PROPERTY OF © IMDEX LIMITED NOVEMBER 2019 PAUL HOUSE – CHIEF OPERATING OFFICER PAUL EVANS – CHIEF FINANCIAL OFFICER & COMPANY SECRETARY
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IMDEX presentation UBS Australasia Conference 2019
CONFIDENTIAL – PROPERTY OF © IMDEX LIMITED
NOVEMBER 2019
PAUL HOUSE – CHIEF OPERATING OFFICER PAUL EVANS – CHIEF FINANCIAL OFFICER & COMPANY SECRETARY
IMDEX at a Glance A leading global Mining-Tech company
Outperforming market growthExciting pipeline of new technologiesCompelling opportunities for sustainable revenue and earnings growth
2
1Q20 RECORD REVENUE
MARKET CAP
$543.3mAS AT 30 SEPT 2019
INSTITUTIONAL INVESTORS
65%
REVENUE CAGR
19%EBITDA CAGR
37% FY17 – FY19
FY19 EBITDA MARGIN
21% STRONG COMPETITIVE POSITION
STRONG NET CASH POSITION
$23.2mAS AT 30 JUNE 2019
STRONG MARKET PRESENCE ON
70%OF MINERAL DRILLING PROJECTS GLOBALLY SALES IN 102COUNTRIES
What Our Technologies Do Enable successful cost-effective operations
We develop cloud-connected sensors and drilling optimisation products to improve the process of identifying and extracting mineral resources globally.
3
• Drilling productivity and rig alignment technologies
• Automated and remote drilling fluid testing technologies
• Data collection and paperless reporting software
• Downhole survey sensors• Core orientation and gamma
logging technologies • In-field sampling and analysis
technologies
• Secure cloud-based services• Real-time subsurface visualization• Interpretive software – geological data
Accurate subsurface data
Drillingfaster & smarter
.........
Receiving real-time information
1.33Drilling faster & smarter
Accurate subsurface data
Receiving real-time Information
IMDEX Technologies Applicable across the whole mining value chain
4MINING & PRODUCTIONEXPLORATION & DEVELOPMENTGRAPHIC SOURCE: CRC ORE
DISCOVERY DEFINITION FRAGMENTATION
Accurate subsurface data
Drillingfaster & smarter
.........
Receiving real-time information
EXTRACTIONPLANNINGEXPLORATION
1.33
“It’s about drilling faster and smarter and knowing your rocks in real-time.”DR MICHELLE CAREY GENERAL MANAGER IMDEX PRODUCT DEVELOPMENT
GEOCHEMISTRY
GEOPHYSICS
SURVEY DATA
013607
STRUCTURAL
GEOLOGY
+
DRILLINGOPTIMISATION
BLAST HOLESENSOR DATA
SPATIAL DATA
SATELLITEIMAGERY
ASSAY
5
IMDEX Integrated Solutions Strong competitive position
COMPREHENSIVE RANGE OF END-TO-END CONNECTED SOLUTIONS
STRONG IP PROTECTION
HIGH BARRIERS TO ENTRY
Record Quarterly Revenue Improving quality of rental offering
Revenue1Q20 up on 1Q19Maintained gross margins
• Steady growth globally• Increasing recurring rental revenue• New technologies provide additional value to clients and
generate higher rental rates• Increasing revenue from mining and production phase
FY19 REVENUE
EXPLORATION & DEVELOPMENT
MINING80%
20%AMERICAS
ASIA PACIFIC
EUROPE & AFRICA
45%
24%
31%
SALES
RENTAL79%
53%47%
6
Compelling Opportunities
7
• Growing our core business by enhancing technical leadership, technical integration and increasing share of client spend
• Further extension into larger adjacent mining market to build non-cyclical revenue
Strategy Compelling opportunities for sustainable growth
EXPLORATION & DEVELOPMENT
MARKETS
MININGPR
ODUC
TS /
TECH
NOLO
GIES
EXIS
TING
NEW
DRILLING PRODUCTIVITY TECHNOLOGIES
(INC COREVIBE™,
XTRACTA™ & MAGHAMMER™)
MARKET EXTENSIONCORE BUSINESS
IMDEX MINING TECHNOLOGIES
(INC BLAST DOG™)
ONGOING R&DCORE BUSINESS
(INC SOFTWARE, IMDEXHUB-IQ™ & AMC MUD CALC™)
8
9
49% OF TOP 100 CLIENTS ARE CONNECTED TO IMDEXHUB-IQ™
CONNECTED CLIENTS GENERATE
60%MORE REVENUE FOR IMDEX THAN NON-CONNECTED CLIENTS
Ongoing R&D Core BusinessConnecting and enhancing our traditional technologies
“If I can get instantaneous information as I’m drilling the ground to understand what to put into our mine plans and into how we work with our trucks, diggers and logistics plans, that is the real unlock for us as a business. What we see as the macro opportunity is the ability to actually link decisions across the value chain.” RAG UDD BHP’S GLOBAL HEAD OF TECHNOLOGY TRANSFORMATION
EXPLORATION & DEVELOPMENT
MARKETS
MINING
PROD
UCTS
/ TE
CHNO
LOGI
ES
EXIS
TING
NEW DRILLING
PRODUCTIVITY TECHNOLOGIES
MARKET EXTENSION
CORE BUSINESS
IMDEX MINING
TECHNOLOGIES
ONGOING R&D
CORE BUSINESS
10
Drilling Productivity Technologies Product Extension
10
COREVIBE™
XTRACTA™
MAGHAMMER™
• High frequency energy pulse assisted drilling for wireline coring
• >30% increase in productivity • Up to 90% increase in
penetration rates
Client Benefits Progress Update
• Allows drillers to change the bit when core is retrieved – no need to pull rods
• The hole is always cased, maintaining hole integrity
• Significant productivity and safety benefits
• Units on rent 1Q20• Trial pipeline in Australia
and North America full• Pilot production on track
• Commencing client trials 2Q20
• Pilot production on track
• Development at IMDEX test site in NZ
• Commercial trials 3Q20
• Combines rotary diamond drilling with fluid driven percussive drilling
• Achieves high penetration rates compared to conventional coring
• Significant safety, cost and environmental benefits
ONGOING R&D
CORE BUSINESS
EXPLORATION & DEVELOPMENT
MARKETS
MINING
PROD
UCTS
/ TE
CHNO
LOGI
ES
EXIS
TING
NEW DRILLING
PRODUCTIVITY TECHNOLOGIES
MARKET EXTENSION
CORE BUSINESS
IMDEX MINING
TECHNOLOGIES
ONGOING R&D
CORE BUSINESS
Attractive addressable coring rig market: COREVIBE™ ~1800* XTRACTA™ ~3000*
*Based on current coring rig utilisation rates
Complements IMDEX’s integrated solutionsWill not cannibalise existing product offering
MAGHAMMER™ initially targeting high speed pre-collar drilling through deep cover to the coring zone, ~1000 RC rigs globally
Strong industry demand for greater productivity - from drilling contractors and resource companies
Unique technologies with strong IP protection
New Drilling Productivity technologies suit IMDEX rental model
Ability to leverage existing cost base, client network and infrastructure globally
Manufacturing and distribution fits well within capabilities
Drilling Productivity Technologies Product extension investment rationale
11
Mining TechnologiesMarket Extension - Blast DOG™
12
BLASTDOG™ • Maximises revenue by increasing mine to mill efficiency
• Predictable fragmentation of blasted ground
• Greater throughput at the processing plant
• Less dilution• Controlled vibration, dust, fumes
and heave• Enhances safety
Co-development project with Orica – the world’s largest provider of commercial explosives and innovative blasting systems. Together we are optimising blasting outcomes based on high-resolution 3D material models and material tracking in the pit.
Client Benefits Progress Update
• Conducting trials with global resource companies in Australia and the US
• Trials include precious and base metals and bulk commodities
• Revenue generation 4Q20
ONGOING R&D
CORE BUSINESS
EXPLORATION & DEVELOPMENT
MARKETS
MINING
PROD
UCTS
/ TE
CHNO
LOGI
ES
EXIS
TING
NEW DRILLING
PRODUCTIVITY TECHNOLOGIES
MARKET EXTENSION
CORE BUSINESS
IMDEX MINING
TECHNOLOGIES
ONGOING R&D
CORE BUSINESS
Mining Technologies - Blast DOG™ Optimised blasting and material tracking
13
Drilling
1
Domaining Analytics
2
OptimisedBlasting
3
Post-Blast Metrics
4
Productivity & Processing Metrics
5
PREDICTABLE FRAGMENTATION OF BLASTED GROUND
ENHANCED PRODUCTIVITY FOR RESOURCE COMPANIES
CONTROLLED VIBRATION, DUST, FUMES AND HEAVE
INCREASED PROCESSING INTENSITY (GREATER THROUGHPUT AT
THE PROCESSING PLANT)
Analytics are applied to identify
material boundaries – i.e. how hard or soft the
ground is
Holes are loggedusing IMDEX multi-sensor,
which measures physical properties
Information from these analytics forms the input for blast design.
Data is transferred via IMDEXHUB-IQ™
The blasting process is optimised – i.e. varying
energy in blast holes depending on ground type
MEDIUM
HARD
HARD
IMDEX Blast DOGIMDEX BHS
SOFT
Mining Technologies Market extension investment rationale
14
Substantial addressable market, ~700 operating mines
Ability to leverage existing infrastructure globally
Strong demand for productivity increases
Leverages existing technology and engineering expertise
Potential to provide substantial additional sustainable rental revenue
Strong support from industry partners – Orica, Anglo American and Teck Resources
15
“We’re excited to be working in collaboration with IMDEX, our customers Anglo, Teck and the broader industry on this project, bringing together world-leading experience and expertise to revolutionise drill and blast operations across the global mining industry.” ANGUS MELBOURNE ORICA’S CHIEF COMMERCIAL AND TECHNOLOGY OFFICER
Orebody Intelligence IMDEX provides high-resolution geoscientific data
Source: Orica 2019 Investor Day Presentation
Outlook & Summary
16
Positive Growth OutlookA strong start to FY20
17
Record 1Q20 revenue – increasing activity reflected in IMDEX’s growing rental fleet
Resource companies – embracing innovation and new technologies to lower cost, increase safety and achieve greater productivity
Major and intermediate resource companies – increasing expenditure to replace reserves
Stronger gold price and uplift in capital raisings globally
New discoveries under cover and at depth – more drilling and longer development times
Four new IMDEX technologies – additional revenue in FY20, recurring commercial revenue from FY21
17
Summary Positioned to deliver attractive returns
18
Strong financial platform – improving recurring revenue and cash flow from operations, ability to increase shareholder returns
Compelling opportunities for sustainable revenue and earnings growth – core business and market extension
Outperforming market growth – market leading patent protected technologies that act as a barrier to entry
Established global company – ability to leverage extensive client network and achieve economies of scale
Expanding market share and margins, driven by an unrivalled range of technologies and the benefits of being the first mover to cloud-enabled instruments
Strong leadership team – successful track record of developing and commercialising technologies in all market conditions
THIS PRESENTATION HAS BEEN PREPARED BY IMDEX LIMITED (“THE COMPANY”). IT CONTAINS GENERAL BACKGROUND INFORMATION ABOUT THE COMPANY’S ACTIVITIES CURRENT AS AT THE DATE OF THE PRESENTATION. IT IS INFORMATION GIVEN IN SUMMARY FORM AND DOES NOT PURPORT TO BE COMPLETE. THE DISTRIBUTION OF THIS PRESENTATION IN JURISDICTIONS OUTSIDE AUSTRALIA MAY BE RESTRICTED BY LAW AND YOU SHOULD OBSERVE ANY SUCH RESTRICTIONS.THIS PRESENTATION IS NOT (AND NOTHING IN IT SHOULD BE CONSTRUED AS) AN OFFER, INVITATION, SOLICITATION OR RECOMMENDATION WITH RESPECT TO THE SUBSCRIPTION FOR, PURCHASE OR SALE OF ANY SECURITY IN ANY JURISDICTION, AND NEITHER THIS DOCUMENT NOR ANYTHING IN IT SHALL FORM THE BASIS OF ANY CONTRACT OR COMMITMENT. THE PRESENTATION IS NOT INTENDED TO BE RELIED UPON AS ADVICE TO INVESTORS OR POTENTIAL INVESTORS AND DOES NOT TAKE INTO ACCOUNT THE INVESTMENT OBJECTIVES, FINANCIAL SITUATION OR NEEDS OF ANY PARTICULAR INVESTOR. THESE SHOULD BE CONSIDERED, WITH OR WITHOUT PROFESSIONAL ADVICE, WHEN DECIDING IF AN INVESTMENT IS APPROPRIATE.THE COMPANY HAS PREPARED THIS PRESENTATION BASED ON INFORMATION AVAILABLE TO IT, INCLUDING INFORMATION DERIVED FROM PUBLICLY AVAILABLE SOURCES THAT HAVE NOT BEEN INDEPENDENTLY VERIFIED. NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, IS MADE AS TO THE FAIRNESS, ACCURACY, COMPLETENESS, CORRECTNESS OR RELIABILITY OF THE INFORMATION, OPINIONS AND CONCLUSIONS EXPRESSED.ANY STATEMENTS OR ASSUMPTIONS IN THIS PRESENTATION AS TO FUTURE MATTERS MAY PROVE TO BE INCORRECT AND DIFFERENCES MAY BE MATERIAL. TO THE MAXIMUM EXTENT PERMITTED BY LAW, NONE OF THE COMPANY, ITS DIRECTORS, EMPLOYEES OR AGENTS, NOR ANY OTHER PERSON ACCEPTS ANY LIABILITY, INCLUDING, WITHOUT LIMITATION, ANY LIABILITY ARISING FROM FAULT OR NEGLIGENCE ON THE PART OF ANY OF THEM OR ANY OTHER PERSON, FOR ANY LOSS ARISING FROM THE USE OF THIS PRESENTATION OR ITS CONTENTS OR OTHERWISE ARISING IN CONNECTION WITH IT.
20
Thank you
FOR FURTHER INFORMATION PLEASE CONTACT:
KYM CLEMENTS IRO & CORPORATE COMMUNICATIONS [email protected]
Appendices
21
Company Snapshot As at 30 September 2019
22
CORPORATE INFORMATION
ASX listed IMD
Share price $ 1.40
Issued shares m 388.1
Market cap $m 543.3
SHARE REGISTERANALYSIS OF TOP 50 SHAREHOLDERS
Institutions 64.75%
Employees, directors & company related parties 3.11%
Private shareholders 6.09%
Brokers & banks 14.63%
LARGEST SHAREHOLDERS SHARES (m) %
Morgan Stanley Australia 37.54 9.67
Yarra Capital Management 34.75 8.96
Fidelity Investments 29.25 7.54
L1 Capital 22.05 5.68
SHARE PRICE – 12 MONTH TREND
IMDEX BoardCommitted to driving growth strategy
Mr Bernie Ridgeway Managing Director
Ms Sally-Anne Layman Non-Executive Director
Mr Anthony Wooles Non-Executive Chairman
Mr Ivan GustavinoNon-Executive Director
Mr Kevin DundoNon-Executive Director
23
Bernie Ridgeway Managing Director
Dave Lawie Chief Geoscientist / Chief
Technologist – Mining Solutions
Paul House Chief Operating
Officer
Sarah Standish IMDEX General
Counsel
Paul Evans CFO & Company
Secretary
Tim Price General Manager – IMDEX
Product Research
Mathew Regan Chief Information and Transformation Officer
Kingsley Weber Human Resources
Director
Derek LoughlinGlobal Business
Development Director
Michelle Carey Global Manager – IMDEX
Product Development
Executive Leadership Team Successful track record
24
25
ESGAchievements & Areas of Focus
25
SAFETY• Improving safety performance• Enhancing visible safety leadership• Improving systems and compliance • Implementing technology solutions – iAuditor • Enhancing employee training and education
ENVIRONMENTAL• Increasing number of solids removal units on rent –
smaller site footprint and significant water reduction• Market a range of bio-degradable drilling fluids
SOCIAL• Implemented Supplier Code of Conduct to align with
IMDEX’s transparent, safe and ethical procurement practices
• Enhanced anti-bribery & anti-corruption framework
GOVERNANCE• Developed Conflict of Interest Policy and process for
disclosing and managing conflicts• Annual employee ethics training and certification• Annual employee anti-bribery and anti-corruption
training • Implementing revised risk, compliance and legal
framework
125.0
25.2
13.5
3.6
19.0
0.8
20%
20.6
Key Metrics A strong financial platform
REVENUE EBITDA NPAT
12% 23% 31%
FY19 FINANCIAL PERFORMANCE(V FY18)
$23.2M
121%
NET CASH POSITION
OPERATING CASH FLOW
FY19$m
FY18$m
VAR $m
Revenue 243.7 218.5 25.2EBITDA 52.3 42.4 9.9EBITDA margin % 21% 19% 2%NPAT 27.6 21.1 6.5EPS (cents) 7.4 5.7 1.7Operating cash flow 35.2 15.9 19.3Net assets 220.0 186.1 33.9Net cash (as at 30 June) 23.2 7.9 15.3Fully-franked interim dividend (cents) 0.8 - 0.8Fully-franked final dividend (cents) 1.4 - 1.4Full-time employees (no. at 30 June) 511 529 (18)
26
Coahuila - Mexico
Salt Lake City - USA
Vancouver - Canada
Smithers - Canada
Torreón - Mexico
San Luis Obispo - USAPhoenix - USA
Santiago - ChileMendoza - Argentina
Lima - PeruQuito - Ecuador
Itajai - BrazilBelo Horizonte - Brazil
Timmins - Canada
Rastede - GermanyEast Sussex - UK
Amsterdam - Netherlands
Accra - Ghana
JohannesburgSouth Africa
Jakarta - Indonesia
Manila - Phillipines
Dubai - UAE
Melbourne- VIC
Townsville - QLD
Adelaide - SA
PERTH - WAKalgoorlie - WA Brisbane - QLD
Parauapebas - Brazil
Auckland -New Zealand
27
STRONG MARKET PRESENCE ON
70% OF MINERAL DRILLING PROJECTS GLOBALLY
SALES IN
102 COUNTRIES
Established Global Business In all the key mining regions of the world
IMDEX Facilities not including distributors
Exploration & Mining Projects
Clients & Industry PartnersLong-standing collaborative relationships
28
OUR CLIENTS
Drilling contractors and resource companies globally
DIRECTLY SUPPORTING MAJOR MINING COMPANIES
LONG-STANDING DRILLING CLIENTS
Top 50 mining companies globally INDUSTRY PARTNERS Long-standing Drilling Clients
AUSTRALIAN SHAFT DRILLING
Top 50 mining companies globally INDUSTRY PARTNERS Long-standing Drilling Clients
AUSTRALIAN SHAFT DRILLING
Top 50 mining companies globally INDUSTRY PARTNERS Long-standing Drilling Clients
AUSTRALIAN SHAFT DRILLING
INDUSTRY PARTNERS / THOUGHT LEADERSHIP
IMDEXHUB-IQ™ Enabling instantaneous information
Survey data On-site computer
TRADITIONAL PROCESS
Transfered to DBA
Input to database
DBA / DBMSE-MAIL SQL
Stored and managed
Sophisticated driller operable
geo-sensors
1.33
013607
• Built-in validation at the time of data collection• Secure chain of custody for your data• Real-time access to data anywhere, anytime• Data agnostic
29
INDUSTRY IS PROGRESSIVELY LOOKING UNDER DEEPER COVER OVER TIME
DEPTH (METRES)
N = 2926
0
500
1000
1500
2000
2500
3000
1900 1920 1940 1960 1980 2000 2020
Base MetalsGoldGold - South Africa
Note: Size of the bubble refers to Moderate, Major and Giant discoveriesExcludes satellite deposits within existing camps. Analysis excludes Nickel laterites and under-sea deposits
Source: MinEx Consulting © March 2017
Note: Size of the bubble refers to Moderate, Major and Giant discoveries
Excludes satellite deposits within existing camps. Analysis excludes Nickel laterites and under-sea deposits
Source: MinEx Consulting © March 2017
New Discoveries Deeper and under ground cover
30
Deeper Drilling Denver Gold Forum - September 2019
31
NEWCREST BRIEFING PACK SANDEEP BISWAS, MANAGING DIRECTOR & CEO
“One of our aspirations is to grow our asset base, ideally “through the drill bit” by focussing on brownfield and greenfield exploration opportunities globally.”NEWCREST 2019 ANNUAL REPORT
1. Looking Deeper in outcrop areas
Newcrest’s unique mining capabilities opens up all search spaces
2. Exporing under cover
32
COREVIBE™ Significant productivity gains for clients
32
HIGH FREQUENCY PULSE ASSISTED DRILLING FOR WIRELINE CORING OPERATIONS
500m
1000m
1500m
2000m
COREVIBE™TRADITIONAL DRILLING
Improves penetration rates
Minimises hole deviation with high penetration rates
67 SHIFTS 47 SHIFTS
Reduces tripping of inner tube for blockages
Extends bit life
UP TO 33% PRODUCTIVITY IMPROVEMENT
XTRACTA™ Significant benefits for clients
ALLOWS DRILLERS TO INSPECT OR CHANGE THE BIT EACH TIME THE CORE IS RETRIEVED
33
Increase Productivity
Reduce Hole Deterioration
Drill Aggressively
Reduce Risk of Injury
No need to pull the rods to change bits - the hole is always cased, maintaining hole integrity
MAGHAMMER™ Significant productivity & safety benefits for clients
34
FLUID DRIVEN PERCUSSIVE DRILLING ON A DIAMOND DRILL RIG
250m
500m
750m
1000m
1250m
MAGHAMMER™ ON DIAMOND DRILL RIGTRADITIONAL RC DRILLINGAIR POWERED WATER POWERED
Entire drill hole can be completed with one rig where RC & Diamond Drilling required
Significantly safer and zero dust generated
Drilling fluid can be recycled with AMC SRU™
Penetration rates are not affected by water intrusion
Operates with any normal drilling fluid
Reduces costs for rig (mobilisation and demobilisation) and fuel
Allows rapid drill case setting
Only limited in depth by pull back capacity of drill rig
Drill & Blast Industry Challenges Fragmentation
ABOVEGROUND OPERATIONSUNDERGROUND OPERATIONS
35
Drill & Blast Industry Challenges Structure
3636
Drill & Blast Industry Challenges Fume
37
Drill & Blast Industry Challenges Manual, inefficient processes
38
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